Google IPO would end long dry spell

But venture capitalists doubt tech bubble will return

After a long dry spell, the venture capital industry is hoping an upcoming initial public offering by Web search giant Google will help start a new flow of cash to young companies. But despite a pick-up in venture financing in the first quarter, the money now being raised bringing new companies public is just a light rain compared to the downpour of cash that flooded the market at peak of the tech boom in 2000.

Figures released Monday show that venture-backed companies took in $5 billion in investments in the first quarter, a healthy gain from the $4 billion collected in the first quarter of 2003. But investment is still down sharply from the $27 billion raised in the first quarter of 2000 at the height of the market bubble, according to a quarterly survey by Venture One/Ernst & Young.

Google, which got $25 million in venture funding from Kleiner Perkins Caufield & Byers and Sequoia Capital in 1999, is widely expected to announce plans for its IPO this week. One reason for the timing is a Securities & Exchange Commission regulation that requires companies with more than 500 shareholders and $10 million in assets to make a financial filing within 120 days of the year they reach that threshold.

Having awarded stock options to most of its 1,000-plus employees, Google is believed to have triggered the rule last year, giving the company until Thursday to provide details on its finances for the first time.

More: MSNBC